The Knights of Labor was the first national union to become prominent in Texas and the southwestern region of the United States. Its emergence came as a result of participation against Jay Gould's southwestern railroads in 1884 and 1885, which resulted in a dramatic nationwide increase in membership from about 100,000 to over 700,000 between mid-1885 and mid-1886. In 1886, however, the Knights suffered a major defeat in the Great Southwest Strike against Gould's Texas and Pacific Railroad. Historians usually credit this defeat with beginning the union's decline.
The first local assemblies of the Knights of Labor appeared in Texas in 1882, with local assemblies established in Houston (3), Sherman (2), Harrisburg (2), Galveston, Waco, Gordon, Fort Worth, and Austin. Most of these local assemblies were mixed-made up of workers of different occupations-but others were composed exclusively of longshoremen, telegraphers, or coal miners. Later, about half of the local assemblies still included workers of different job descriptions, but those for specific trades included local assemblies of railroad laborers, railroad-shop employees, locomotive firemen and section foremen, painters, carpenters, bricklayers, stonemasons, lumber workers, farmers, mechanics, laborers, cotton screwmen, paperhangers, baking-powder makers, cotton workers, merchants, and farmers listed as renters or croppers or tenants. By far the largest number of the local assemblies, however, were composed of farmers and those listed as "mixed." Membership figures remain scarce, but at their height in the mid-1880s, the Knights had more than 300 local assemblies in Texas and, according to the Dallas Morning News, over 30,000 members in the state in 1885. The Knights were unique in allowing women, farmers, and others usually not associated with organized labor to become members; in fact, all "toilers" except doctors, lawyers, bankers, liquor dealers, and professional gamblers were eligible to enroll. The Knights also welcomed African Americans, although most Blacks, but not all, were in segregated local assemblies. One, David Black, served on the Knights' state executive board.
Nationally, the organization dated from December 1869, when nine Philadelphia tailors established the Noble and Holy Order of the Knights of Labor. Under the influence of Uriah Stephens, one of the nine, the organization retained the mystery and secrecy of its early years, which were thought to attract members and to protect them from hostile employers. The Knights called for the abolition of the wage system; they did not believe that the "bread and butter" goals practiced by the trade unions offered the best course of action for working men. They espoused the abolition of child labor, the regulation of trusts, government ownership of public utilities, the admission of women and Black workers, equal pay for women, the regulation of alien and contract labor, and mediation, conciliation, and the use of the boycott rather than the strike. The union grew slowly before the railroad strikes of 1877 and dropped its secrecy after Terence V. Powderly became grand master workman in 1879. The Knights of Labor was not a true industrial union, since some of its local assemblies covered broad geographical areas and many included workers of different job descriptions.
During the Great Southwest Strike of 1886, the public, after initially supporting the strikers, abandoned the labor cause with the onset of widespread violence and a national reaction against all unions in the aftermath of the Haymarket riot in Chicago. The Knights suffered rapid decline and by 1893 had only about 75,000 members nationally. Although they appeared to be the dominant force among American labor unions at the beginning of 1886, the Knights soon learned they did not possess the organization, leadership, or financial base with which to compete with powerful, nationally based corporations. Officially, the union remained active until 1917, when long-time treasurer and last grand master workman, John W. Hayes, shut down operations and stored the union records in a shed behind an insurance building in Washington, D.C. In fact, however, the Knights were finished as a national force by 1894, although a number of local assemblies were active throughout the 1890s and a lesser number after the turn of the century. The last active local assemblies in Texas were at Sand Flats and Tazewell (1898) and Ballinger (1899). Despite their failure and the subsequent emergence of the American Federation of Labor, the Knights of Labor is remembered for its reform philosophy, which promoted a better society for all workers, skilled and unskilled and eschewed the narrow goals of the trade unions.